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IPO NOTE
Issue Highlights:
Issuer: CL Educate Limited
Issue Type: 100% Book Built Issue IPO
Issue Open: Monday, March 20, 2017
Issue Close: Wednesday, March 22, 2017
*Anchor bidding on 17th March 2017 Friday
Commencement of Trading: April 05, 2017
Issue Size (Rs): Rs. 238.00 crs (lower band) & Rs. 238.95 crs (upper band)
Face Value: Rs.10 per Equity Share
Price Band: Rs. 500 – Rs.502 per Equity Share
Minimum Order Quantity Retail: 29 Shares
Maximum Bid amount for Retail: Rs. 2 Lakhs
Listing: BSE, NSE
Issue Size and Investor Category Allocation
QIB (including Anchor): 50% of the Offer Rs.119.48 crs^
NIB: 15% of the issue size 35.84 Crs^
Retail Individual Bidders: 35% of the Offer Rs.83.63 Crs ^
(^ @ upper price band)
Book Running Lead Managers:
KOTAK Mahindra Capital Company Ltd.
Registrar:
Karvy Computershare Pvt Ltd
Key Business Strategies:
Expand geographical footprint and increase test prep
center utilization across India, in test prep business.
Develop and derive synergies from our publishing and
content development business.
Diversify business into the B2BC spectrum of the
education sector
Selectively capitalize on opportunities in the vocational
training business.
Key Strengths:
Publishing and Content Development
Diversified and integrated education products, services,
content and infrastructure provider, with pan-India
presence and a focus on knowledge-creation.
Reputed courses, particularly in the aptitude based test
prep segment.
Asset-light, technology-enabled business model
Strong brand equity.
Public issue of upto 4,760,000 Equity Shares of the face value of Rs. 10
each (“Equity Shares”) of CL Educate Limited. The offer comprises a
fresh issue of 2,180,119 Equity Shares by our company (“Fresh Issue”)
and an offer for sale upto 2,579,881 Equity Shares by the selling
shareholders.
Objects of the Issue:
Company proposes to utilize the Net Proceeds from the Fresh Issue
towards the following objects:
1. Funding working capital requirements of Company and
Subsidiaries, GKP and Kestone;
2. Pre-payment of outstanding amount of a debt facility
availed of by Subsidiary, CLIP;
3. Acquisitions and other strategic initiatives; and General
corporate purposes.
About the Issuer:
CL Educate Limited is a diversified and integrated
technology-enabled provider of education products,
services, content and infrastructure, with a presence
across the education value chain.
The company integrated business, marketing and sales
services for corporates, conducted under brand Kestone,
including event management, marketing support (including
digital marketing support), customer engagement,
managed manpower and training services;
During the six months ended September 30, 2016,
company had 53,892 enrolments in test prep courses
(including 15,491 online enrolments, referring to
enrolments through website, and 38,401 offline
enrolments).
900.931,153.75 1,182.99
1,496.971,643.55
0.00
500.00
1,000.00
1,500.00
2,000.00
FY 12 FY 13 FY 14 FY 15 FY 16
Revenue from operation (In Millions.)
-53.76
67.43
23.57
76.59
49.18
-100
-50
0
50
100
FY 12 FY 13 FY 14 FY 15 FY 16
Net Profit (Rs. In Million)
CL EDUCATE LIMITED
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IPO NOTE
SUMMARY STATEMENT OF ASSETS AND LIABILITIES, AS RESTATED
CL EDUCATE LIMITED
` in Million
30-Sep-16 31-Mar-16 31-Mar-15 31-Mar-14 31-Mar-13 31-Mar-12
119.40 119.40 116.45 99.18 99.18 93.35
EQUITY AND LIABILITIESShareholders’ fundsShare capital
Reserves and surplus 2556.15 2478.50 2276.59 1033.67 1009.25 806.33
2675.55 2597.90 2393.04 1132.85 1108.43 899.68
- - - 13.86 - 29.45
45.54 45.86 44.96 18.88 36.26 117.47
17.89 15.40 17.87 18.05 2.69 -
Non-current liabilitiesLong-term borrowings
Deferred tax liabilities (net)
Long-term provisions 26.15 22.94 19.43 13.58 8.34 7.04
89.58 84.20 82.26 50.51 47.29 124.51
252.67 330.53 236.53 240.66 234.45 163.17
- - - - - -
478.79 455.28 241.65 146.53 62.29 98.35
347.30 320.82 299.45 254.01 329.00 391.67Other current liabilities
Short-term provisions 8.85 0.61 0.51 0.46 1.48 1.15
1087.61 1107.24 778.14 641.66 627.22 654.34
Total 3852.74 3789.34 3253.44 1838.88 1782.94 1707.98
327.78 329.47 341.55 336.84 349.33 411.46
111.75 103.05 117.80 110.75 123.37 136.78
ASSETSNon-current assetsFixed assets
- Tangible assets
- Intangible assets
- Capital work-in-progress - - - - 0.09 -
1716.25 1716.36 1525.86 453.28 406.02 364.46
- - - - - 32.68
38.56 56.42 67.54 84.65 92.68 72.10
Non-current investments
Deferred tax assets (net)
Long-term loans and advances
Other non-current assets 112.03 112.03 112.41 132.43 150.91 4.12
2306.37 2317.33 2165.16 1117.95 1122.40 1021.60
Share application money pending allotment
Current liabilitiesShort-term borrowings
Trade payables
(i) total outstanding dues of micro
enterprises and small enterprises
(ii) total outstanding dues of creditors
other than micro enterprises and small
enterprises
Particulars As at
Current assetsCurrent investments - - - - - -
Inventories 43.07 42.12 44.75 33.65 24.28 12.50
Trade receivables 841.73 843.80 535.23 358.91 312.96 264.02
Cash and bank balances 52.96 79.91 113.35 44.66 65.29 157.97
Short-term loans and advances 482.70 390.96 283.01 204.91 189.07 233.79
Other current assets 125.91 115.22 111.94 78.80 68.94 18.10
1546.37 1472.01 1088.28 720.93 660.54 686.38Total 3852.74 3789.34 3253.44 1838.88 1782.94 1707.98
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IPO NOTE
Source
for
Note:
DRHP
IMPORTANT: Please
read
the
Red
Herring
Prospectus
of this
issue
carefully
before
investing
in
the
same.
:: Research Desk :: :: Research Desk ::
PF/IPON/17032017/22
E-mail:
Direct Ph: 040 3321 7132
Disclaimer
The information and views presented in this report are prepared by Karvy Stock Broking Limited. The information
contained herein is based on our analysis and upon sources that we consider reliable. We, however, do not vouch for the
accuracy or the completeness thereof. This material is for personal information and we are not responsible for any loss
incurred based upon it. The investments discussed or recommended in this report may not be suitable for all investors.
Investors must make their own investment decisions based on their specific investment objectives and financial position
and using such independent advice, as they believe necessary. While acting upon any information or analysis mentioned
in this report, investors may please note that neither Karvy nor Karvy Stock Broking nor any person connected with any
associate companies of Karvy accepts any liability arising from the use of this information and views mentioned in this
document.
SUMMARY STATEMENT OF PROFITS AND LOSSES, AS RESTATED
CL EDUCATE LIMITED
` in Million
30-Sep-16 31-Mar-16 31-Mar-15 31-Mar-14 31-Mar-13 31-Mar-12IncomeRevenue from operations 840.41 1643.55 1496.27 1182.99 1153.75 900.93
Other income 54.05 94.91 62.20 64.43 201.48 120.81
Total Revenue 894.46 1738.46 1558.47 1247.42 1355.23 1021.74
ExpensesPurchases of traded goods 68.00 153.74 145.72 117.41 103.35 52.57
(Increase)/decrease in inventory of
traded goods
(1.10) 2.79 (11.68) (9.37) (11.78) (12.50)
Cost of services 352.10 719.14 613.94 483.11 492.45 381.53
Employee benefits expense 126.02 248.01 247.84 220.57 196.41 184.68
Finance costs 23.36 51.82 47.17 44.13 59.07 40.61
Depreciation and amortisation
expenses
23.24 62.19 50.86 37.45 37.25 28.28
Other expenses 196.33 427.38 366.78 299.69 375.70 241.78
Total expenses 787.95 1665.07 1460.63 1192.99 1252.45 916.95
Restated profit before exceptional expenses and tax
106.51 73.39 97.84 54.43 102.78 104.79
Exceptional expenses - - - 15.49 - 196.62
Restated profit/(loss) before tax 106.51 73.39 97.84 38.94 102.78 (91.83)Income tax expense:- Current tax 32.68 26.67 23.79 7.86 - 7.63
- Minimum alternate tax ('MAT') credit - - - (7.86) - (7.63)
- Deferred tax charge/(benefit) 2.49 (2.46) (2.54) 15.37 35.35 (38.07)
Total tax expenses 35.17 24.21 21.25 15.37 35.35 (38.07) Restated net profit/(loss) after tax 71.34 49.18 76.59 23.57 67.43 (53.76)
Particulars For the period/year ending
